Average mortgage interest rates in the United States reached an all-time low for the week ending September 10, 2020, according to Freddie Mac's weekly Primary Mortgage Market Survey.
The 30-year, fixed-rate mortgage loan interest rate averaged 2.86 percent, with an average 0.8 point. It was the lowest rate in the survey's history, which dates back to 1971. The 30-year note averaged 2.93 percent the week before and 3.56 percent the same week last year.
"Mortgage rates have hit another record low due to a late-summer slowdown in the economic recovery," Sam Khater, Freddie Mac's Chief Economist, said. "These low rates have ignited robust purchase demand activity, which is up 25 percent from a year ago and has been growing at double-digit rates for four consecutive months. However, heading into the fall, [sales] will be difficult to sustain the growth momentum in purchases because the lack of supply is already exhibiting a constraint on sales activity."
The number of single-family homes and condominiums on the market in the Greater Boston area has decreased over the past three months, according to data from MLS Property Information Network, Inc. On June 11, 2020, there were 10,845 houses and condos for sale compared to 10,085 on September 11, 2020.
According to the Mortgage Bankers Association's Weekly Mortgage Applications Survey, mortgage applications to purchase increased for the week ending September 4, 2020. The seasonally adjusted "Purchase Index" increased 3 percent from the prior week. The unadjusted Purchase Index increased by 0.2 percent compared with the previous week and jumped 40 percent higher than the same week last year.
"Purchase applications were 40 percent higher than the same week last year, but the increase is skewed higher by being compared to Labor Day 2019," Joel Kan, MBA's Associate Vice President of Economic and Industry Forecasting, said. "Nevertheless, there continues to be resiliency in the purchase market. Applications were up almost 3 percent on a weekly basis, and the average loan size continued to increase, hitting a survey high at $368,600."
The 15-year, fixed-rate mortgage averaged 2.37 percent, with an average 0.7 point. The 15-year loan, a popular choice for refinancing, averaged 2.42 percent the preceding week and 3.09 percent the same week last year.
The five-year, adjustable-rate mortgage (ARM) loan averaged 3.11 percent, with an average 0.2 point, up slightly from the prior week when it averaged 2.93 percent. The five-year ARM averaged 3.36 percent last year.